Uranium Energy (AMEX:UEC) released third-quarter financial results and hosted an earnings call on Tuesday. Read the complete transcript below.
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Summary
Uranium Energy Corp reported significant milestones, including the commencement of production at the Berkolo project, marking it as the largest greenfield ISR uranium project in over a decade.
The company operates two of its three US Hub and Spoke ISR production platforms and holds the largest uranium resource base in the US, with 10 permitted projects.
Financially, Uranium Energy Corp ended the quarter with $794 million in liquid assets, no debt, and a continued focus on an unhedged strategy to capture market pricing.
Operationally, the company expects increased production rates in the fourth fiscal quarter as new header houses become operational, despite a temporary increase in cost per pound due to regulatory delays.
The United States Uranium Refining and Conversion Corp made progress with the US Nuclear Regulatory Commission and is aligning with federal priorities to expand domestic uranium conversion capacity.
The company's critical mineral portfolio, including the Alta Parana project in Paraguay, presents opportunities to contribute to US supply chains for titanium and vanadium.
Management highlighted the strategic positioning of Uranium Energy Corp amidst growing policy momentum for energy independence and nuclear fuel cycle sovereignty in the US.
Full Transcript
OPERATOR
Good day and welcome to the Uranium Energy Corp's third quarter earnings Conference call. All participants will be in listen only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. After today's presentation there will be an opportunity to ask questions. To ask a question you may press star, then one on your telephone keypad. To withdraw your question, please press Star and then two.
Please note this event is being recorded. I would now like to turn the conference over to Amir Adnani, Uranium Energy Corp's Founder and CEO. Please go ahead.
Amir Adnani (Founder and CEO)
Thank you operator and good morning everyone. A presentation accompanying today's call is available on our website. Some of the commentary today will include forward looking statements and I would encourage everyone to review the cautionary language on slide 2 of the presentation. With that, let's begin with highlights from the quarter. This quarter was marked by several defining milestones along the continued execution of our long term strategy to become America's first and only vertically integrated uranium company.
From mining and processing through refining and conversion, we are also pleased to provide an update on our critical mineral portfolio. The commencement of production at Burke Hollow is a significant achievement for UEC and an important milestone for domestic uranium production in the United States. It is the largest graduate greenfield ISR uranium project to come into production in more than a decade. It has been incredible to see our team develop the project from a grassroots discovery in 2012 to production in 2026.
Let that sink in for a moment. It took 14 years to bring a new uranium mine online. That timeline highlights the scarcity and strategic value of fully permitted and operating uranium mines not only in the United States but globally. It also underscores a significant competitive advantage for UEC which today controls 10 permitted uranium projects in the U.S. we are very proud of our team's efforts and accomplishments over the past 14 years to advance Burke Hollow.
In addition, we would like to thank our landowner and stakeholders for their support. Building on the scale of our asset base, we are now operating two of our three US Hub and spoke ISR production platforms. We control the largest uranium resource space in the United States which provides the foundation for decades of staged production growth. Our strong balance sheet and inventory physician with no debt provides us with the opportunity to pursue our 100% unhedged strategy, selling opportunistically and capturing industry leading realized pricing, generating meaningful returns for shareholders.
Through our wholly owned subsidiary United States United States Uranium Refining and Conversion Corp.. We have created maximum alignment with the renewed bipartisan focus on energy independence and national security in the US this opportunity positions UEC as the only American vertically integrated nuclear fuel supplier from mining through conversion as nuclear power expands and fuel sourcing ships back onshore. With policy momentum building and long term uranium supply gaps growing, we are strategically placed at the convergence of market demand and government priorities.
With that overview, let's turn to operational highlights. In the third quarter, our focus remained on expanding production capacity while maintaining a low cost production profile. As I highlighted, commencing production at Burke Hollow was a significant achievement. Burke Hollow is an important part of UEC's growth strategy allowing us to initiate production at our second hub and spoke platform anchored by the Hobson central processing plant at Christensen Ranch.
We received regulatory approval for expanded production, adding an additional three header houses at the end of March. With these approvals now in hand, we anticipate increased production rates in the fourth fiscal quarter. We have an additional five header houses under construction and one additional header house has been completed and is on standby for regulatory approval. During the quarter, 32,000 pounds of uranium concentrate were produced at a total cost per pound of $54.61 including a cash cost per pound of $46.69.
Cost per pound did increase during the quarter, but we view this as a temporary and largely a timing related event. Regulatory approvals delayed production from new header houses while costs associated with bringing those production areas online were incurred before the associated uranium production was fully reflected in quarterly volumes. Given the sensitivity of unit costs to production rates during this stage of the ramp up, together with higher state taxes, these factors increased cost per pound during the quarter.
As production rates increase from the newly commissioned header houses, we expect costs per pound to improve. Since commissioning, UEC's total cost per pound remains a leader in the domestic industry at $39.30 including a cash cost per pound of $32.40 across £276,000 produced at Ludeman Project, our next planned ISR uranium operation in Wyoming, we completed a 240 hole delineation drilling program at Sweetwater, our third hub and spoke production platform anchored by the Sweetwater mill.
We completed a 200 hole delineation drilling program in the first two planned well fields at Roughrider Project, our development stage conventional asset located in the Athabasca Basin in northern Saskatchewan. Core drilling is over 80% complete to support our planned pre feasibility study. A key component of our long term strategy is the United States Uranium Refining and conversion Corp. Or URNC. Uranium conversion remains an acute bottleneck in the Western nuclear fuel cycle with insufficient commercial UF6 capacity and outside Russia and China.
At the same time, a critical gap in the US Nuclear fuel cycle is the lack of a vertically integrated domestic supplier spanning mining, processing, refining and conversion. That gap underscores the importance of UEC's initiative with URNC. During the quarter, we made important strides to advance the project. We achieved our first US Nuclear Regulatory Commission licensing milestone through receipt of a docket number. Further ongoing discussions with the U.S. department of Energy regarding strategic nuclear fuel cycle infrastructure led us to add additional candidate locations to ensure coordination and alignment with federal priorities for restoring domestic uranium conversion capacity and strengthening America's nuclear fuel supply chain. We have now developed the final short list of candidate locations. Finally, we're excited to spotlight a recent update for one of our critical mineral projects, Alto Paraná in Paraguay.
A recent completed independent report determined that the project represents a globally significant critical minerals platform with the potential to materially contribute to the security and and diversification of US supply chains for titanium and vanadium. UEC's critical minerals portfolio, which includes the West Bear Cobalt Nickel Project in Canada, has been assembled through timely acquisitions over the last decade and represents additional embedded value that we will look to unlock for shareholders through ongoing initiatives.
This strategy and component of our business and aligns with the urgent need of re establishing critical mineral supplies in support of national and economic security. Now, turning to our financial position, we finished the quarter with $794 million in liquid assets, including $488 million in cash along with uranium inventory and equities and importantly no debt. As of April 30, 2026, we held 1.4 million pounds of U308 valued at approximately $127 million at current market prices, excluding the additional approximately 277,000 pounds of precipitated uranium and dried and drummed U308 held at the Iriguiri Central Processing Plant.
UEC's balance sheet combined with our unique unhedged strategy provides the flexibility to be selective in the execution of sales. As demonstrated in the third quarter where we preserved our inventory as many are familiar, our operational platform is built around scalable hub and spoke ISR operations in Wyoming and South Texas supported by longer term development projects at Sweetwater and Roughrider Project starting in Wyoming. Through our ongoing construction campaigns, we continue to scale production at Christensen Ranch, which operates as the first spoke to the Iriguiri CPP.
As of April 30, 2026, total cumulative production from Christianson Ranch since restart was approximately 277,000 pounds and of precipitated uranium and dried and drummed U308 at the Ariguiri CPP at a total cost per pound of $39.30 including a cash cost per pound of $32.40. The company continued to develop new production areas at Christianston Ranch during the quarter. Turning to Ludeman Projectn UEC's next planned ISR operation, the previously announced 240 hole delineation drilling program was completed.
This work will assist well field pattern design currently underway. Engineering of the satellite ion exchange plant progressed with the plant layout and pad design largely finalized and fabrication of the ion exchange vessels ahead of schedule. We continue to advance the remainder of the mechanical equipment specifications which allows the company to begin to procurement process for longer lead time equipment Turning to South Texas, we commenced production at the Burke Hollow project on April 8, 2026 in order to initiate the uranium recovery process.
Oxygen and carbon dioxide were injected into the well field and will provide initial feed to the ion exchange plant. The satellite ion exchange plant was commissioned and well field development continues in Phase 1A. Now that it is online, we expect to see production from Brokolo accounted for in the fiscal fourth quarter of 2026. Looking further ahead towards our development stage assets, Sweetwater is earmarked to be a major future production center and we are working expeditiously towards this operation as both a conventional mill and a central plant for processing ISR production.
Further, a 200 hole delineation drilling program in the first two planned well fields at Sweetwater commenced in March and was completed in early May. A second 200 hole delineation drilling program is scheduled to begin in July 2026 where the third ISR well field at Sweetwater is planned. Finally, the ion exchange vessels for the Sweetwater ISR circuit are under construction In Saskatchewan, Canada. We continued advancing the Roughrider Project project, one of the highest grade undeveloped uranium projects in the world.
More than 80% of the planned 35,000 meter drilling program has now been completed in support of the upcoming pre feasibility study. Turning to URNC, in addition to the progress we have made on siting, we continue to accelerate engineering work led by Fluor and have advanced into a new phase with a significant expansion of engineering and technical resources supporting facility design, siting, licensing and development. Through this process we have been engaging with the U.S. department of Energy to align with key national priorities regarding restoring nuclear fuel cycle sovereignty. As a result, additional candidate locations were added to ensure coordination and alignment with such priorities. Last but not least, Alto Paraná, our project in Paraguay. As mentioned, a recently completed independent report concluded that the project represents a globally significant critical minerals platform with the potential to materially contribute to the security and diversification of US Supply chains for titanium and vanadium.
The project's unique strategic fit includes being located in a US Aligned partner country, its access to clean, low cost power and its ability to integrate into US and allied downstream processing supply chains. We view the project as notable because it addresses structural vulnerabilities in US Critical minerals policy. It demonstrates our long standing approach to identifying, acquiring and developing assets that align with U.S. national security, advanced manufacturing and resilient critical mineral supply chains.
Finally, the broader policy backdrop remains robust. On April 23, 2026, the U.S. department of Energy, through its Office of Nuclear Energy and the Defense Production Act Nuclear Fuel Cycle Consortium launched the Nuclear Dominance 3:33 campaign to secure the United States nuclear fuel supply chain and support future reactor deployment. The campaign is structured around three core objectives to be achieved by 2033, including catalyzing a secure and cost competitive domestic nuclear fuel supply chain, accelerating advanced reactor deployment, and finally leveraging the DPA framework to align workforce development, financing, innovation and industry collaboration in support of the nuclear build out. Against that backdrop, let me briefly summarize the progress we made during the quarter. First, we successfully brought online the largest greenfield ISR project in the US in over a decade. Burke Hollow's progression from discovery in 2012 to production in 2026 serves as a reminder that uranium production capacity cannot simply be created overnight, reinforcing the important strategic value of UEC's operating assets and portfolio of permitted uranium projects.
Second, we have expanded capacity enabling increased production rates as we move towards the end of the fiscal year. Lastly, we have advanced URNC to a final short list of candidate locations and are moving toward the next phase of engineering, siting and licensing activities. All of this was accomplished while maintaining one of the strongest balance sheets in the sector with significant liquidity and no debt. With the largest uranium resource base in the United States, growing production infrastructure and a clear pathway towards expanding our role across the nuclear fuel cycle, we believe UEC is well positioned for the next phase of growth in the uranium market. Our strategic critical mineral portfolio provides for adjacent opportunities supported by similar policy priorities. Before we open the line for questions, I'd like to note that I'm joined today by Josephine Mann, our Chief Financial Officer Scott Melby, our Executive Vice President and Brent Berg, our Senior Vice President of US Operations Operations. With that operator, please open the line for questions.
OPERATOR
We will now begin the question and answer session. To ask a question, you may press Star then one on your touchtone phone. If you are using a speakerphone, please pick up your handset before pressing the keys. If at any time your question has been addressed and you would like to withdraw your question, please press star and then two. Also, please limit yourself to one question and one follow up re queue to ask additional questions. Our first question comes from Brian Lee with Goldman Sachs. Please go ahead.
Brian Lee (Equity Analyst)
Hey guys, thanks for taking the questions. I guess I had a couple here. First on the cost side, Amir, be curious, I know you said it's going to normalize a bit here into fiscal Q4 and beyond and the lower volumes in fiscal Q3 and the taxes obviously pushed costs up in the quarter. Can you maybe quantify a little bit sort of what that normalization is going to look like over the next quarter or two? Are you back into the 30s as quickly as fiscal Q4?
Is that going to take a couple quarters and then maybe give us some of the moving pieces? Beyond volume, are there other cost drivers beyond just higher production volumes?
Amir Adnani (Founder and CEO)
Hi Brian, thank you for the question. And as you've seen in the press release and the remarks earlier that I made, we did highlight sort of the key drivers here and really to expand on it and your question, as you know, a large portion of our operating costs are fixed. So again, when production volumes are temporarily lower due to the timing of these well field approvals, unit costs are impacted. We would definitely sort of draw attention to the total cost per pound over the course of the £276,000 produced, which comes in, as you know, within a cash cost per pound of roughly $32.40. This remains industry competitive and a leading number in the domestic industry in the US as we mentioned in the press release and the material, Brian, we do expect that the trend on production going into fiscal Q4 and beyond is higher.
So again, in an environment where this is the biggest sensitivity for us and the economies of scale do matter, definitely think that we should be improving on the numbers that you saw in this quarter. Let me just pause and hand it over to our CFO Josephine Mann for just any additional color or commentary on that.
Josephine Mann (Chief Financial Officer)
Thanks Amir. Hey, this is Josephine. Yeah, I think Amir is correct as we are expecting to increase our production in the coming quarters. Definitely we will see the total cost per pound and cash cost per pound to be comparatively lower than this quarter as what Amir mentioned that, you know, a big portion of our operating costs are fixed. So when the production volumes are temporary low during this quarter, it definitely drives the total cost per pound increase as compared to our Q2.
But with the new wellfields at Christensen Ranch and at Burke Hollow coming to production in the full fourth quarter this fiscal year, we are expecting to have a lower cost per plan in the coming quarters. Back to Yambir. Thank you, Josephine. Brian, did you have a follow up on that?
Brian Lee (Equity Analyst)
Yeah, no, that's helpful. Maybe. Just as we think about those production volumes with the three header houses on in Christensen Ranch and Burke Hollow producing in Q4 sort of what's the step function? It seems like there should be a step function increase in volumes. Is it pretty linear where we can kind of take the header houses in Christensen Ranch and look at the volume from Q3 and sort of triple that? Or what's sort of the ramp up cadence if you will, at least in the near term.
And then maybe last question, if I could squeeze it in. Just thoughts around URNC and the timing of key milestones as we think about the second half of the calendar year here. Thank you.
Amir Adnani (Founder and CEO)
Thank you Brian. And you certainly squeezed a lot in there. But okay, we'll unpack all of that. We've been really ramping up when it comes to our construction capability and campaigns to build additional header houses which is basically production capacity. And yes, there is a linear relationship there. And again for context, if we step back, this is after our industry really collectively was dormant for about 15 years. And the last couple of years we're coming back into this, this, this area and this time of incredible progress and activity. I'm going to hand it to Brent Burke to speak a bit about the growth we've had year over year in terms of our personnel, workforce, capacity and the ability to keep expanding and constructing this production capability.
Brent Berg (Senior Vice President of U.S. Operations)
Brent, over to you. Oh, there you go. Go ahead. You were muted, Brent, but just start from start again. Okay, very good. Ryan. I was just saying that a year ago we had 103 employees in Wyoming and Texas. Today we've grown our operations team to 185 personnel. So in 2025 the, you know, the UEC team was heavily dependent on external contractors for construction and continued mine development. Today much of that work is being done in house by our own team and we continue to build a team that can rapidly deploy to other projects in UEC's portfolio.
And maybe just one other note with respect to production and normalizing. So during the quarter the bulk of that Production came from Wellfields 8 and 10 with eight active header houses and production predominantly came from new wells that were installed in 2025 with header houses 107 and, and 108 accounting for the bulk of the production during the fiscal quarter. Of course, we started up, well, field 11, three new header houses at the end of the quarter. And we really won't see that production until this fourth quarter, but anticipate that to move up substantially. Thank you. Back to you, Amir.
Amir Adnani (Founder and CEO)
Okay. And Brian, I think you were asking about URNC, and specifically, as we mentioned in the release, we're really ramping up into the next phase here of engineering work, siting, permitting with an expansion of the engineering team and the work that's being provided by Fluor as well, our own team increased in size and scope over this period. The siting work has been coordinated, as we mentioned in the press release, with some of the initiatives that are taking place at the Department of Energy, making sure we have maximum alignment there.
We've always believed that the project and really the need to build a new conversion facility and has maximum alignment with priorities in the US Right now around creating a more resilient nuclear fuel cycle and to really repatriate the nuclear fuel cycle. With the Russian ban kicking in by end of 2027, really, that's around the corner. The, the current, the current key bottleneck in our mind and in the market really remains a shortage of sufficient domestic conversion.
So that work is advancing and really has kicked into next year from a standpoint of the engineering siting and licensing, as we mentioned. Thank you, Ryan.
OPERATOR
And the next question comes from Heiko Ile with HC Wainwright. Please go ahead.
Heiko Ile
Hello, Amir and team. Thanks for taking my questions. And I just want to point out the stock's still up, you know, 68% year over year, so something's going right. That said, how much in this quarter would you say was a continuation of regulatory delays that was seen in the last quarter? I mean, it looks like you're working past all of that, but maybe just give a bit of color. I mean, it's now, you know, almost mid June, some color on the current quarter and maybe even the remainder of calendar 2026.
Amir Adnani (Founder and CEO)
Thank you, Heiko, and I appreciate the context that your question provides. And if we step back and if you've been following the company, you know that we talked about these regulatory delays extensively in our last quarter. And so really this is a continuation of that. And it's a continuation of a broader theme of industry growing pains that we're experiencing just as the industry and ourselves are ramping up. Brent spoke about the fact that the sheer size of our workforce has gone from just over 100 people to almost 200 people year over year. Imagine that kind of growth? Well, the regulators are going through similar type of staffing and other bandwidth capacity that they need to have.
And so these regulatory delays that we experienced which impacted lower production in this quarter were discussed and really described in the last quarter and we're making good progress. Those approvals did come in, except that they came in near the end of this quarter. And so hence it was a delay. But these are delays that have been resolved and so that's important to highlight as well. So things are progressing and that's why it gives us the confidence as well to be able to speak to a better outlook and improve the numbers going into the fourth fiscal year for the company and beyond that. So for sure, I think to your point, if we step back, there should be no surprises here. But at the same time, when you look at even the numbers for this quarter from a production cost point of view, you zoom out and look at it.
Over the £276,000 produced, the company's still delivering on the lowest cost production in the United States and in the domestic industry. So we've got a lot of capacity in front of us. Coming online, the additional header houses at Christiansen Ranch, the construction that's going to be taking place at Ludamen, that'll be our third ISR operation in Wyoming. And not to mention Burk Hollow that did start operations this quarter and will be contributing to production moving forward.
We're very proud of the work at work. Hollow, as you know, that's a project that's 14 years in the making. I talked about it earlier in my remarks and so can't lose sight of all the construction, development and deliverables that we have here as well.
Heiko Ile
Fair enough. Completely different thing. Let's talk about your equity book a little bit. I mean, this obviously has been creating a decent amount of volatility over the past few quarters. Is there a way to more normalize this going forward just for stability and more predictability for the analyst community?
Amir Adnani (Founder and CEO)
Yeah, that's a fair question, Heiko. And as you know, our equity book is strategically positioned in some names that we have exposure to in the sector. It does cause this quarterly mark to market volatility this quarter. As you also know, given some weakness and kind of flat movement we saw in the uranium prices, we selected to continue to maintain our inventory position. So there were no sales this quarter and again, that was intentional and that's a function of our on hedge strategy. But moving forward, as we achieve more of a regular quarterly cadence of sales and reporting around that equity book, I think can probably move towards more of a on an adjusted basis where we can maybe pull that out and not have it impact the reported numbers.
And Josephine, if you want to comment on that as well, but I think that's part of the progression of where we're hopefully heading. Josephine, if you want to add to that.
Josephine Mann (Chief Financial Officer)
Yes, thanks, Amir. And hi, Cole. I think that's right. The volatility in the market creates a little bit of, you know, unknown to the income statements. As you can see in our quarterly results, you know, about $19 million was attributed to that change in fair market value of our equity securities. So moving forward, you know, the reconciliation of disclose of adjusted EBITDA I think help the community and our stakeholders to understand our results of operations better. Back to you, Amir.
Amir Adnani (Founder and CEO)
All right, thank you. Thank you, Heiko.
OPERATOR
And the next question comes from Alexander Pierce with bmo. Please go ahead.
Alexander Pierce
Great, thanks. Morning all. So, Amir. Well, this may be a question for Brent, but just building on the question we had before about production in the quarter, if we took the delayed new header houses aside from it, production was down quarter on quarter. So maybe you can just talk about what you're seeing in the older header houses and was this a function of tie ins or flow rates or what? That's the first part of the question. Thanks.
Amir Adnani (Founder and CEO)
Hi, Alex. Yeah, thank you for that and good to have you on the call. Yeah, I'll hand it over to Brent here shortly. But definitely, I would say again, most of what you would normally see, Alex, in terms of how an operation like this with really multiple header houses would be able to manage some of the near term natural decline curves that are going to be inevitable in some of the producing well fields. With much fewer numbers online right now, there's bound to be some greater volatility in kind of the quarter over quarter numbers. But certainly as that bandwidth increases in terms of number of wells, well fields and header houses, we should be able to smooth the numbers out and better manage that natural decline curve that exists and institute recovery and hand it over to Brent now. Go ahead, Brent.
Brent Berg (Senior Vice President of U.S. Operations)
Yeah, thanks, Amir. And Alex, maybe just a little color on that. So the production at Christensen Ranch came predominantly from well Fields 8 and 10, with eight active header houses operating. And that production came predominantly from new wells that were installed in 2025. So header houses 10.7 and 10.8 accounted for over 50% of that production in the fiscal Q3. And 87% of overall production came from new well field patterns that we installed in the same year. So, you know, with that We've really focused our production ramp up with ongoing mine development and that development continued in Both well Field 12 and 10 expansion, where we have five header houses under construction. Two of those in Wellfield 10 are nearing completion, with another two under construction.
And one header house in well Field 12 is nearing completion of construction. You know, so in total, four header houses are planned in well Field 12 for future production. The monitor wells have been completed. The pump test is planned. With respect to well installation, all drilling is completed for header house 12 1. And in that Wellfield 10 extension, drilling at header houses 10, 9, 1010 and 1011 is complete and drilling started for header house 10 12. So we've been really focused on development and you know, of course, you know, collaboration with our regulators is important, but you know, really I think the best way we can assure that new production comes online quickly is by steadily advancing new infrastructure on the ground. Amir, back to you.
Amir Adnani (Founder and CEO)
All right, thank you, Brent. Alex, back to you.
Alexander Pierce
Okay, thanks for that. Maybe a second part of the question then. Obviously you've mentioned the new wellfields coming on with the new regulatory approvals, but have you seen any streamlining of the process for getting the regulatory approval so that going forward maybe you can manage better and avoid some of the delays that you saw for this round?
Brent Berg (Senior Vice President of U.S. Operations)
Go ahead, Brent. Yeah, I would say the state regulatory agencies have demonstrated a very high level of collaboration and are, you know, they're actively working to address some of those longer lead time challenges that, you know, naturally arise during periods of increased industry activity. You know, I would. Uec, of course, has remained active and has an ongoing dialogue with the agencies, you know, continuing to advance well field development in parallel. And you know, I'd say this coordinated approach allows us to progress and maintain both regulatory and operational fronts. You know, the timing for the reviews ultimately rests with the agencies themselves. And you know, however, I can confirm that the infrastructure development and related activities continue to move forward and you know, we'll certainly provide more updates as key operational milestones are achieved.
I would say, you know, the regulator much, much like us when we restarted operations, is of course growing and responding to increased, you know, regulatory submissions that, that come across their desks. And you know, we are seeing some, some progress and some improvement. Back to you, Amir.
Amir Adnani (Founder and CEO)
All right, thank you. Thank you, Alex.
Alexander Pierce
Thank you.
OPERATOR
And the next question comes from Justin Chan with SCP Financial. Please go ahead.
Justin Chan
It's scp, but I'll forgive him that I was probably bumbled there. Thanks for taking questions, Amir and Brad. Hi guys. Maybe just to follow up On Alex's question on maybe first to clarify, I guess you would have five header houses now producing at Christensen Ranch, like five plus or two plus three. And then maybe just as a bigger kind of. My main question on this direction is what level of header houses and maybe rollouts per month do you think you'd need to get to that 1 million or 2 million pounds a year level? Given, you know, some of the wells will be declining, you'll. You'll need new ones to come on. I guess. What do you see as steady state in that regard?
Amir Adnani (Founder and CEO)
Hey, Justin, thanks for the question. And there's no doubt, and this is what you're building on, that there is a linear relationship between this construction activity, building new header houses and well fields, and the increase in production that we're expecting and building out. We're right now, as you know, reporting and kind of providing updates on this activity in our quarterly reports. And by the time I think you see us report the fiscal year end where we've had a chance to bring several more of the header houses online and see them actually in operation, there'll be a better ability to kind of forecast and see the contribution from each header house towards a segment of production. Bottom line is that not every header house is the same size or created equal.
So while there is a linear relationship, I think some of that ability to kind of just extrapolate that forward may not be as simple as kind of, you know, this many header houses to get to that end result. And as you know, you know, we're really looking to get to those higher production outputs. We have the largest resource base in the US we've got £12 million of combined license capacity. But to really increase production, we need to be able to continue to deliver on some new projects and new header houses, all of which is moving forward and advancing Brook Hollow being a notable one. And so we'll have more information on all of that. But Brent, if you want to just comment on that too, additionally for Justin's question.
Brent Berg (Senior Vice President of U.S. Operations)
Yeah, absolutely. Hi, Justin. As you noted, we had two header houses constructed and installed in 2025. Those are header houses in Wellfield 10, Expansion 10.7 and 10.8. Of course, we recently added three into production in well Field 11. So that's 11, 1, 3 and 4, and we've got five under construction. Now the other thing I would note, Justin, is, you know, we've significantly increased our drilling capacity to install wells that of course drive production as well. And you know, we've got a threefold increase from when we Started the operation at Christensen Ranch to today. So, you know, we're really ramping up our construction capacity and you know, zeroing in on increasing our production profile as we move forward. Amir, back to you.
Amir Adnani (Founder and CEO)
All right, thank you for that. Thank you, Justin.
OPERATOR
And the next question comes from Joseph Rager with Roth capital partners. Please go ahead.
Joseph Rager
Hey, Amir and team, thanks for taking the questions. A lot of what I wanted to ask was already touched on, but just kind of a few things left. I guess you guys did a good job of explaining why production declines over time. But as you look back at Christensen ranch's performance to date compared to what was, let's say in, you know, the model ahead of time, you know, has it performed in line with expectations? Slightly better, slightly worse. Obviously the, you know, regulatory stuff's out of your control, but how is the mine performing compared to the model?
Amir Adnani (Founder and CEO)
Hey, Joe. I mean, thank you for that. And you know, we couldn't be any more clear about the performance. I mean the ultimate performance of any mine is the, is the cost and the output and the efficiencies there. And for a project that on this call in particular, we've spent a lot of airtime given to regulatory delays that are outside of our control. We can't lose sight of the fact that we're £277,000 in across really a modest number of header houses and we have industry leading production costs. That's really a testament to the efficiency of the operation, the quality of our team and the work that's being done to really deliver these industry leading numbers.
So I would argue, and I think you and I have talked about this, that the cost numbers out of Christensen Ranch in fact have come in better than expected and better than expectations that folks had in terms of how the project can do. So there's no doubt that as we continue to expand the project, our confidence is built on the foundation that this could be a very efficient, low cost operation. And it really is about making sure we can install and construct and build that additional output and capacity which headerhouse has afford and provide. So certainly something that we're very pleased about. This is a project that is a brownfield and historically has, prior to our restart, had six, seven years of prior operating history as well. So it's certainly a notable project along the way.
As you know, we've had not just refurbishments, but upgrades and all types of work done that we've reported in prior quarters. So we've come a long way in a very short period of time and it's really only been about 15, 16 months since production started. And as I mentioned in the last quarter most of this low cost production so far has been carried at I'd say six. Almost 70% of the load has been carried by two header houses. That's quite remarkable.
So certainly gives us the confidence to continue to invest. And you've seen that in our numbers that we had increased investment in Christensen Ranch this past quarter, which was really driven by the additional construction work that we're doing and are completing and have underway.
Joseph Rager
Yeah, just good to have you say it. That was a sense I got. And then the other item, you know, it's mentioned in the release that you know you're working on the PFS for Roughrider. What's the timing goal for you guys to have that PFS like to have the summary released?
Amir Adnani (Founder and CEO)
Joe, that's a great question. And we're as you noticed in the release, didn't list an end time on that. And that's mainly because we're almost done with the conversion drilling. We're 80% done. We need that work to be completed. We need to make sure that all the steps with respect to getting our chemical assay results back on that drilling is in hand and so the work can be completed with the third party technical and engineering firms that are, that are on board and available.
If, if I had to sort of estimate at this point what we're looking at, Joe, I would say we're estimating towards the end of the calendar year to have that PFS ready, but that's an estimate at this point and, but something that we're, you know, definitely working towards and hopefully we'll have it by then.
Joseph Rager
Okay, I'll turn it over. Thanks Mir.
Amir Adnani (Founder and CEO)
Thank you, Joao.
OPERATOR
And the next question comes from Christian Kashani with National Bank Capital Markets. Please go ahead.
Christian Kashani
Hi Amir and all. Thanks for taking my question. Colleen, on behalf of Mohamed, just going back to the UR and C timing that we were talking about earlier. I just wanted to confirm that the conversion study should now be expected in 2027.
Amir Adnani (Founder and CEO)
Hey yeah, Christian, thanks for that question. It should be a 2027 event between now and then. We will have further updates along the way as we're progressing on the work, including again whether it's on siting, whether it's any of our discussions with strategic partners and, or the US Government and or even potential utility offtake discussions that we're having. So there will be updates along the way. But with respect to the work that will culminate in supporting what would ultimately be a Class 4 cost study, which is what the next phase of study on this will be, will be a first half of calendar 2027 events.
Christian Kashani
Great, thanks very much. And then I was wondering if you folks could provide us with some more color on the change in ad valorem taxes and or production based royalties in Wyoming for modeling purposes.
Josephine Mann (Chief Financial Officer)
Yeah, I'm going to hand it over to our CFO Josephine man to provide some color on that. Go ahead, Josephine. Yeah, thanks Amir. Thanks for the question. Yeah. So this is a normal and routine process with the Wyoming Department of Revenue. So they have been very fair to the uranium industry during the previous ups and downs in the commodity cycle. So we see that the state of wyoming tax levies 2 separate tax on the mineral production in the states.
So it's a surface tax and the volume tax. The service tax is imposed on at the state level while the volume tax is imposed on the county level. So right now we see that there is an increase in the industry factors that the Department of Revenue used to capture the value of the uranium production to calculate both taxes. So in this quarter we saw there's an increase that in this industry factors. And the increase was for four year cycle. So this new industry factors is applied prospectively to from 2026 to 2029.
So we'll see steady industry factor that will be applied to our uranium production in the next couple of years. Back to you, Amir.
Amir Adnani (Founder and CEO)
Okay, thank you, Josephine. And thank you, Christian. This concludes our question back to the operator.
OPERATOR
I would like to turn the conference back over to Amir and Adnani for any closing remarks.
Amir Adnani (Founder and CEO)
Thanks. Yes, thank you. And thank you all for joining the call today. And we look forward to any follow on communications that we might have with you in the coming days. And look forward to the quarter ahead. Thank you all and have a good rest of your day.
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